I’m writing a business plan, and part of it, of course, are the financials.
Specifically, I’m looking to find out where I can find financial ratios, web traffic forecasts, and other industry standards for blogging ‘companies’ or other e-commerce sites that deal almost exclusively with the free information arena, like, uh, blogs.
I mean how do you calculate profit from the event of getting most of your revenue from advertisers?
Is there a website that will show me financial ratios for these kinds of companies or websites themselves? for free?
You are in one of the ‘fun parts’ of building a financial plan here. Tough one.
Each industry varies. You probably already have the projection for the firs financial year down based on present numbers.
Do some research. I included a site that MAY help you. Some industries have a higher growth rate than others. Downside factors like inflation and depreciation of currency and assets, couple of things to consider.
Profit is calculated simply : Gross earnings – cost = P
In your case, you will have to determine what your rate is going to be for advertisers. You are not going to charge a client the same rate for a period of 5 years are you? The income from an advertiser will be in proportion of your running costs.
If my site [example, but I had my own IT company one] costs me to run $6000 per year and my advertising space is booked at $12000 per year, well next year my projection shows that costs may rise $500 for the year where my advertisers are concerned so adjust it in the same ratio.
Check out the site. Hope it helps a bit. You do have some reading to do there so best of luck!
Knowledge of your business, the industry, and the market.
To make projections, such as sales forecasts, break down sales into manageable parts. For example, first outline the products and services you offer, the unit price for each item, the anticipated inventory, projected sales per item for each day, week, month, etc. You will base these numbers on your experience in the industry and research. Finally, make an educated guess regarding total sales. Using the same procedure, calculate your expenses or startup costs if launching a new business.
References :
You are in one of the ‘fun parts’ of building a financial plan here. Tough one.
Each industry varies. You probably already have the projection for the firs financial year down based on present numbers.
Do some research. I included a site that MAY help you. Some industries have a higher growth rate than others. Downside factors like inflation and depreciation of currency and assets, couple of things to consider.
Profit is calculated simply : Gross earnings – cost = P
In your case, you will have to determine what your rate is going to be for advertisers. You are not going to charge a client the same rate for a period of 5 years are you? The income from an advertiser will be in proportion of your running costs.
If my site [example, but I had my own IT company one] costs me to run $6000 per year and my advertising space is booked at $12000 per year, well next year my projection shows that costs may rise $500 for the year where my advertisers are concerned so adjust it in the same ratio.
Check out the site. Hope it helps a bit. You do have some reading to do there so best of luck!
References :
http://www.valuationresources.com/IndustryFinancial.htm